Mobile network operators (MNOs) face an uphill task to remain economically viable, with global data delivery costs threatening to grow about seven times in the next five years, according to a new report from Juniper Research.
The technology analyst house said that MNOs must explore means of addressing data delivery costs and inefficiencies in base station operations to survive.
According to the ‘Mobile Operator Business Models: Challenges, Opportunities & Adaptive Strategies 2011-2016’ report, even with the increased deployment and utilisation of LTE networks, global MNO data delivery costs could surpass $370bn annually by 2016, compared with $53bn in 2010.
However, the report also said that future operating costs could be significantly reduced by the deployment of data offload services, such as Wi-Fi networks and femtocells, allied to the utilisation of network optimisation techniques to facilitate flow control.
The report also observed the potential for substantial savings at the base station level, identifying both active and passive network sharing as a means of reducing site lease costs and reducing energy loss by using feederless sites and remote radio heads.
Juniper Research also recommended that operators in developing markets that are reliant on diesel to power off-grid generators should accelerate their transition to renewable alternatives.
Report author Dr Windsor Holden said the case for reducing network inefficiency is both environmental and economic.
"By implementing solutions designed to reduce energy wastage, not only will MNOs markedly cut their operating costs but they will following sustainable business practices which reduce greenhouse gas emissions," Holden said.
The report suggests that Tier 2 operators should continue to offer unlimited data plans to gain competitive advantage, while warning that regulatory pricing controls will continue to negatively impact operator margins.
